US real estate struggles to attract investors
The real estate sector in the US continues to experience a period of transition. In 2024, the residential market showed signs of recovery, with sales up 13.3% year-on-year, while the commercial market continued to suffer. For insiders, the outlook for 2025 looks good, but investors do not seem to agree for the time being.
We analysed the strength of the real estate sector of the S&P500 by comparing it with the Dow Jones, an index less affected by the performance of the biggies in the technology sector. The graph above shows the trend in relative strength. One can see the trend reversal that started last September and led the indicator to touch one-year lows just in the last few weeks. Technically we can also see the downward crossing of the medium and long term moving averages (bearish signal).
This chart suggests that investors’ interest is currently oriented towards other sectors, with higher growth prospects and less uncertainty.
